U.S.
SECURITIES AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 Form
10-K
 
 (Mark
One)
 
 x ANNUAL REPORT UNDER
SECTION 13 OR 15(d)
 OF
THE SECURITIES EXCHANGE ACT OF 1934
 
 For the
fiscal year ended December 31, 2008
 
  ̈ TRANSITION REPORT UNDER
SECTION 13 OR 15(d)
 OF
THE SECURITIES EXCHANGE ACT OF 1934
 
 For the
transition period from ______________ to ______________
 
 Commission
File Number 000-52948
 
  Sputnik
Enterprises Inc.
 (Exact
name of registrant as specified in its charter)
  
  Nevada
                    
                    52-234-8956(State
      or other jurisdiction of
                    
                    (I.R.S.
      Employerincorporation
      or organization)
                    
                    Identification
      No.)
 
 650
5THSTREET SUITE 303 SAN FRANCISCO, CA 94107
 (Address
of principal executive offices)
 
 (415)
355-9500
 (Registrant’s
telephone number, including area code)
  
  Securities
registered under Section 12(b) of the Exchange Act:
 
 None.
 
 Securities
registered under Section 12(g) of the Exchange Act:
 
 Common Stock, $0.001 par
value per share
 (Title of
Class)
 
 Check
whether the registrant is a well-known seasoned issuer, as defined in Rule 405
of the Securities Act.  Yes
 ̈  No
x
 
 Check
whether the registrant is not required to file reports pursuant to Section 13 or
15(d) of the Exchange Act.  ̈
   
   Check
whether the registrant (1) has filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes x  No  ̈
 
 Check if
there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-K (§229.405 of this chapter) contained herein, and no disclosure
will be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.  ̈
 
 Check
whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company.  See
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
  Large Accelerated Filer
                     ̈
                    
                    Accelerated
      Filer
                     ̈Non-accelerated
      Filer
                     ̈
                    
                    Smaller
      Reporting Company
                    x(Do
      not check if a smaller reporting company.)
 Check
whether the issuer is a shell company (as defined in Rule 12b-2 of the Exchange
Act).  Yes x  No
 
 As of
December 31, 2008, there were no non-affiliate holders of common stock of the
Company.
 
 APPLICABLE
ONLY TO CORPORATE REGISTRANTS
 
 As of
March 30, 2009, there were 295,278 shares of common stock, par value $.001,
outstanding.
   
   INDEX
 
 Page
      NumberItem
      Number
                
                PART
      IItem
      1
                
                Description
      of Business
                4Item
      1A
                
                Risk
      Factors
                5Item
      1B
                
                Unresolved
      Staff Comments
                6Item
      2
                
                Description
      of Property
                6Item
      3
                
                Legal
      Proceedings
                6Item
      4
                
                Submission
      of Matters to a Vote of Security Holders
                6PART
      IIItem
      5
                
                Market
      for Common Equity and Related Stockholder Matters
                6Item
      6
                
                Management's
      Discussion and Analysis or Plan of Operation
                7Item
      7
                
                Quantitative
      and Qualitative Disclosures About Market Risk
                7Item
      7A
                
                Quantitative
      and Qualitative Disclosures about Market Risk.
                8Item
      8
                
                Financial
      Statements
                8Item
      9
                
                Changes
      in and Disagreements with Accountants on Accounting and Financial
      Disclosure
                8Item
      9A
                
                Controls
      and Procedures
                8Item
      9B
                
                Other
      Information
                9PART
      IIIItem
      10
                
                Directors,
      Executive Officers, Promoters and Control Persons; Compliance with Section
      16(a) of the Exchange Act
                10Item
      11
                
                Executive
      Compensation
                11Item
      12
                
                Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters
                11Item
      13
                
                Certain
      Relationships and Related Transactions, and Director
      Independence
                12Item
      14
                
                Principal
      Accountant Fees and Services
                13Item
      15
                
                Exhibits
                13Signatures
                
                
                24
 
  
 
 PART
I
 
 Item
1. Description of Business.
 
 Sputnik
Enterprises Inc. (“we”, “us”, “our”, the "Company") was incorporated in the
State of Delaware on September 27, 2001 under the name Sputnik, Inc. On February
10, 2005, we filed Articles of Conversion and new articles of incorporation in
Nevada and became a Nevada corporation. From that time until February 29, 2008
the Company developed and marketed Wi-Fi software, services, and hardware for
the public access wireless networking market.
 
 On
November 13, 2007 we formed a wholly owned subsidiary, Laika, Inc., and
transferred all of our assets and liabilities to Laika.
 
 On
February 6, 2008, the Company amended its Articles of Incorporation to change
the name of Sputnik, Inc. to Sputnik Enterprises, Inc. upon conclusion of the
sale of the stock of Laika, Inc. to AstroChimp, Inc., a Nevada corporation
wholly owned by David LaDuke, Sputnik’s President and Director.
 
 On
February 29, 2008, we closed the sale of the stock of our wholly owned
subsidiary, Laika, Inc. to AstroChimp, Inc. for cancellation of $65,000 of David
LaDuke to us, leaving us as a shell company.  AstroChimp is
wholly-owned by Mr. LaDuke. Subsequently Astrochimp, Inc. changed its name to
Sputnik, Inc. and continues to own and operate its business as a private
entity.
 
 Sputnik
Enterprises seeks the consummation of a reverse merger with another operating
company but following the sale of the stock of our wholly owned subsidiary,
Laika, Inc. to AstroChimp, Inc. has had and will have no active operations until
such reverse merger is finalized.
   4
   Item 1A. Risk Factors
 
 As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, the Company
is not required to provide this information.
 
  5
 
 Item
1B.  Unresolved Staff Comments
 
 None
 
 Item
2. Description of Property.
 
 The
Company neither rents nor owns any properties. The Company utilizes the office
space and equipment of its management at no cost. Management estimates such
amounts to be immaterial.  The Company currently has no policy with
respect to investments or interests in real estate, real estate mortgages or
securities of, or interests in, persons primarily engaged in real estate
activities.
 
 Item
3. Legal Proceedings.
 
 To the
best knowledge of our officers and directors, the Company is not a party to any
legal proceeding or litigation.
 
 Item
4. Submission of Matters to a Vote of Security Holders.
 
 None.
 
 PART
II
 
 Item
5. Market for Common Equity, Related Stockholder Matters and Small Business
Issuer Purchases of Equity Securities.
 
 Common
Stock
 
 Our
Certificate of Incorporation authorizes the issuance of up to 50,000,000 shares
of common stock, par value $.001 per share (the “Common Stock”).  The
Common Stock is listed on the OTC-BB with the symbol SPNI.OB.  As of
March 30, 2009, there were 98 shareholders of record of the Common
Stock.
 
 Preferred
Stock
 
 On
February 6, 2008, Sputnik amended our Articles of Incorporation to authorize the
issuance of 10,000,000 shares which will be designated “Preferred Stock”. The
Company has not yet issued any of its preferred stock.
 
 Dividend
Policy
 
 The
Company has not declared or paid any cash dividends on its common stock and does
not intend to declare or pay any cash dividend in the foreseeable future. The
payment of dividends, if any, is within the discretion of the Board of Directors
and will depend on the Company’s earnings, if any, its capital requirements and
financial condition and such other factors as the Board of Directors may
consider.
 
 Securities
Authorized for Issuance under Equity Compensation Plans
 
 The
Company does not have any equity compensation plans or any individual
compensation arrangements with respect to its common stock or preferred stock.
The issuance of any of our common or preferred stock is within the discretion of
our Board of Directors, which has the power to issue any or all of our
authorized but unissued shares without stockholder approval.
 
 Recent
Sales of Unregistered Securities
 
 None
   6
 
 Issuer
Purchases of Equity Securities
 
 None.
 
 Item
6.  Selected Financial Data
 
 As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, the Company
is not required to provide this information.
 
 Item
7.  Management’s Discussion and Analysis of Financial Condition and
Results of Operation
 
 Sputnik
Enterprises seeks the consummation of a reverse merger with another operating
company. The Company currently does not engage in any business activities that
provide cash flow.  During the next twelve months we anticipate
incurring costs related to:
 
 (i)
              filing
      Exchange Act reports, and
 
 (ii)
              investigating,
      analyzing and consummating a reverse
merger.
 
 We
believe we will be able to meet these costs through use of funds loaned to or
invested in us by our stockholders, management or other investors.
 
  Liquidity
and Capital Resources
 
 On
February 29, 2008, we closed the sale of the stock of our wholly owned
subsidiary, Laika, Inc. to AstroChimp, Inc., leaving us as a shell
company.  All expenses will be funded as an advance by our officers as we
have no assets, liabilities or source of revenues.
 
 On
December 31, 2008 we had total assets of $0 compared to assets of $97,050 at
December 31, 2007, as a result of discontinuing
our operations.
 
 We had
total liabilities of $26,940 as of  December 31, 2008, which consisted
solely of current liabilities and included $25,000 in note payable and $1,940 of
accrued liabilities. We had an accumulated deficit from prior operations of
$1,912,836 and an accumulated deficit from development stage of $46,462, as of
December 31, 2008.
 
 We had
net cash used of ($105,282) for the year ended December 31, 2008, which
consisted of net loss from operations of ($46,462), net loss from discontinued
operations of ($91,467), loss on disposal of ($3,864), depreciation of $1,578,
inputed interest on note payable of $2,908, note payable for legal expenses of
$25,000, changes in accounts receivable of ($5,660), changes in inventory of
($1,776), changes in prepaid expenses and other current assets of ($2,467), and
changes in accounts payable and accrued liabilities of $16,928.
 
 We had
net cash used by investing activities of ($23,580) for the year ended December
31, 2008, which consisted of cash distributed in spin off of
($23,580).
 
 We had
$113,154 in net cash provided by financing activities for the year ended
December 31, 2008 which consisted of ($20,369) change in line of credit and
other liabilities, $18,523 donated from shareholder, $135,000 proceeds from
advance from shareholder.
 
 Results
of Operations
 
 Our net
loss for 2008 was $(141,793), which is not comparable to the results of
operations in 2007 because on February 29, 2008, we closed the sale of the
stock of our wholly owned subsidiary, Laika, Inc. to AstroChimp, Inc., leaving
us as a shell company. The net loss consisted of ($46,462) from continuing
operations, ($91,467) from discontinued operations, and ($3,864) loss on
disposal.
   7
 
 Off-Balance
Sheet Arrangements
 
 The
Company does not have any off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on the Company’s financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that is
material to investors.
 
 Contractual
Obligations
 
 As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, the Company
is not required to provide this information.
 
 Critical
Accounting Policies
 The
financial reports for the period contained one additional critical accounting
policy which was also an initial adoption of accounting policy that had a
material impact.  Below is a brief discussion of events that
materially affected our financial statements and the basis in which the
transactions were recorded.
 
 DEVELOPMENT
STAGE ENTERPRISE - As a result of the Company’s sale of the operations of
Sputnik, Inc., the Company is now considered a development stage enterprise
pursuant to FASB Statement 7, which focuses on development stage companies.
Users of the financial statements should be familiar with this statement and its
effect on the financial statements.
  Item
7A.  Quantitative and Qualitative Disclosures about Market
Risk.
 
 As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, the Company
is not required to provide this information.
 
 Item
8.  Financial Statements.
 
 The
financial statements required by this Item 8 begin with the Index to the
Financial Statements which is located prior to the signature page.
  Item
9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.
 
 None
 
 Item
9A(T). Controls and Procedures.
 
 Evaluation
of Disclosure Controls and Procedures
 
 We
carried out an evaluation, under the supervision and with the participation of
our management, including our principal executive officer and principal
financial officer, of the effectiveness of our disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)).  Based upon that evaluation, our principal executive
officer and principal financial officer concluded that, as of the end of the
period covered in this report, our disclosure controls and procedures were not
effective to ensure that information required to be disclosed in reports filed
under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the required time periods and is accumulated and communicated to
our management, including our principal executive officer and principal
financial officer, as appropriate to allow timely decisions regarding required
disclosure.
 
 Our
management, including our principal executive officer and principal financial
officer, does not expect that our disclosure controls and procedures or our
internal controls will prevent all error or fraud.  A control system,
no matter how well conceived and operated, can provide only reasonable, not
absolute, assurance that the objectives of the control system are
met.  Further, the design of a control system must reflect the fact
that there are resource constraints and the benefits of controls must be
considered relative to their costs.  Due to the inherent limitations
in all control systems, no evaluation of controls can provide absolute assurance
that all control issues and instances of fraud, if any, have been detected. To
address the material weaknesses, we performed additional analysis and other
post-closing procedures in an effort to ensure our consolidated financial
statements included in this annual report have been prepared in accordance with
generally accepted accounting principles. Accordingly, management believes that
the financial statements included in this report fairly present in all material
respects our financial condition, results of operations and cash flows for the
periods presented.
   8
 
 Management’s
Report on Internal Control over Financial Reporting
 
 Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting as defined in Rule 13a-15(f) under the
Securities Exchange Act, as amended.  Our management assessed the
effectiveness of our internal control over financial reporting as of December
31, 2008. In making this assessment, our management used the criteria set forth
by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”)
in Internal Control-Integrated Framework.  A material weakness is a
deficiency, or a combination of deficiencies, in internal control over financial
reporting, such that there is a reasonable possibility that a material
misstatement of the company's annual or interim financial statements will not be
prevented or detected on a timely basis.  We have identified the
following material weaknesses.
 
 1.
              As
      of December 31, 2008, we did not maintain effective controls over the
      control environment.  Specifically we have not developed and
      effectively communicated to our employees its accounting policies and
      procedures.  This has resulted in inconsistent
      practices.  Further, the Board of Directors does not currently
      have any independent members and no director qualifies as an audit
      committee financial expert as defined in Item 407(d)(5)(ii) of Regulation
      S-K.  Since these entity level programs have a pervasive effect
      across the organization, management has determined that these
      circumstances constitute e a material
weakness.
 
 2.
              As
      of December 31, 2008, we did not maintain effective controls over
      financial statement disclosure. Specifically, controls were not designed
      and in place to ensure that all disclosures required were originally
      addressed in our financial statements.   Accordingly, management
      has determined that this control deficiency constitutes a material
      weakness.
 
 Because
of these material weaknesses, management has concluded that the Company did not
maintain effective internal control over financial reporting as of December 31,
2008, based on the criteria established in "Internal Control-Integrated
Framework" issued by the COSO.
 
 Change
In Internal Control Over Financial Reporting
 
 There
were no changes in our internal control over financial reporting that occurred
during our last fiscal year that have materially affected, or are reasonably
likely to materially affect, our internal control over financial
reporting.
   Attestation
Report of the Registered Public Accounting Firm
 
 This
annual report does not include an attestation report of our registered public
accounting firm regarding internal control over financial
reporting.  Management’s report was not subject to attestation by our
registered public accounting firm pursuant to temporary rules of the SEC that
permit us to provide only management’s report in this annual
report.
 
 Item
9B. Other Information.
 
 None.
 
  9
   PART
III
 
 Item
10. Directors, Executive Officers, Promoters and Control Persons; Compliance
With Section 16(a) of the Exchange Act.
 
 (a)  Identification
of Directors and Executive Officers.  The following table sets forth
certain information regarding the Company’s directors and executive
officers:
 
 Name
                          
                          Age
                          
                          PositionDavid
      LaDuke
                          
                          48
                          
                          Director,
      Chief Executive Officer, President, Chief Financial Officer and
      Secretary
 
 The
following is information on the business experience of each director and
officer.
 
 Mr.
LaDuke has served as President and Chief Executive Officer of Sputnik since
February 2002. Since April 12, 2005, Mr. LaDuke has served as our Treasurer.
 Since November 2003, he has served as Secretary of Sputnik. In November
1998, he co-founded Linuxcare Inc. a provider of enterprise services for
open-source software. He served as Vice President of Marketing there until April
2001. From June 2001 to July 2003 and March 1993 to November 1998, Mr. LaDuke
was an independent consultant in technology, marketing and business strategy for
various companies including Apple Computer, Crystal Decisions, Netscape
Communications, Oracle Corporation, Pinnacle Systems, Silicon Graphics, and
others. From November 1989 to February 1993, Mr. LaDuke worked as the manager of
publishing industry marketing at NeXT Computer, Inc., a computer manufacturing
company acquired by Apple Computer in 1996.  From September 1986 to October
1989, Mr. LaDuke worked in marketing positions at Apple Computer, Inc. Mr.
LaDuke earned an M.B.A. from the Tuck School of Business Administration at
Dartmouth College in 1985, an M.F.A. from Columbia University in 1983 and an
A.B. from Columbia College, Columbia University in 1982.
  (b)  Significant
Employees.
 
 As of the
date hereof, the Company has no significant employees.
 
 (c)  Family
Relationships.
 
 There are
no family relationships among directors, executive officers, or persons
nominated or chosen by the issuer to become directors or executive
officers.
  (d)   Involvement
in Certain Legal Proceedings.
  There
have been no events under any bankruptcy act, no criminal proceedings and no
judgments, injunctions, orders or decrees material to the evaluation of the
ability and integrity of any director, executive officer, promoter or control
person of Registrant during the past five years.
  Compliance
with Section 16(a) of the Exchange Act
 
 Section 16(a)
of the Exchange Act requires the Company’s directors and officers, and persons
who beneficially own more than 10% of a registered class of the Company’s equity
securities, to file reports of beneficial ownership and changes in beneficial
ownership of the Company’s securities with the SEC on Forms 3, 4 and 5.
Officers, directors and greater than 10% stockholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms
they file.
  Based
solely on the Company’s review of the copies of the forms received by it during
the fiscal year ended December 31, 2008 and written representations that no
other reports were required, the Company believes that no person(s) who, at any
time during such fiscal year, was a director, officer or beneficial owner of
more than 10% of the Company’s common stock failed to comply with all
Section 16(a) filing requirements during such fiscal years.
  Code
of Ethics
  The
Company does not have a code of ethics for our principal executive and financial
officers. The Company's management intends to promote honest and ethical
conduct, full and fair disclosure in our reports to the SEC, and compliance with
applicable governmental laws and regulations
   10
 
 Nominating
Committee
 
 We have
not adopted any procedures by which security holders may recommend nominees to
our Board of Directors.
 
 Audit
Committee
 
 The Board
of Directors acts as the audit committee. The Company does not have a qualified
financial expert at this time because it has not been able to hire a qualified
candidate. Further, the Company believes that it has inadequate financial
resources at this time to hire such an expert.  The Company intends to
continue to search for a qualified individual for hire.
 
 Item
11. Executive Compensation.
 
 Summary
of Cash and Certain Other Compensation
 
 The
following sets forth the compensation of the Company's executive officers for
the two fiscal years ended December 31, 2008.
 
 Executive
Officer Compensation Table
  The named
executive officers received the following compensation from Sputnik Enterprises
during the fiscal year ended December 31, 2008 and November 30,
2007.
 Name and Position
                                            
                                            Year
                                            
                                            Cash Compensation
                                            
                                            Other CompensationDavid
      LaDuke, current President and Director
                                            
                                            2008
                                            
                                            $15,400
                                            
                                            None2007
                                            
                                            $92,400
                                            
                                            None
 Director
Compensation
 
 We do not
currently pay any cash fees to our directors, nor do we pay directors’ expenses
in attending board meetings.
 
 Employment
Agreements
 
 The
Company is not a party to any employment agreements.
 
 Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.
 
 (a)           The
following tables set forth certain information as of December 31, 2008,
regarding (i) each person known by the Company to be the beneficial owner of
more than 5% of the outstanding shares of Common Stock, (ii) each director,
nominee and executive officer of the Company and (iii) all officers and
directors as a group
  Name and Address
                          
                          Amount and Nature of
                            Beneficial Ownership
                          
                          
                          Percentage
                            of ClassSputnik,
      Inc.(1)
                          
                          
                          860,000
                          
                          
                          
                          86.4
                          %All
      Directors and Officers as a Group
                            (1
      company)
                          
                          
                          860,000
                          
                          
                          
                          86.4
                          %
 _____________
 
 (1)           David
LaDuke is sole officer and director of Sputnik, Inc.
 
 (b)           The
Company currently has not authorized any compensation plans or individual
compensation arrangements.
 
  11
 
 Item
13. Certain Relationships and Related Transactions.
 
 During
2008, we have not entered into and as of December 31, 2008 we do not have any
agreements to enter into any material transactions with any director, executive
officer, and promoter, beneficial owner of five percent or more of our common
stock, or family members of such persons.
 
 Sputnik’s
financial condition has continued to deteriorate since September 30,
2007.  Sputnik’s liabilities now exceed its assets and it has negative
shareholder equity and net worth.  Unless its business plan succeeds,
it will cease operations.  Sputnik has explored all other transaction
structures which will allow Sputnik to implement its business plan and avoid
ceasing operations and has determined that no other viable alternative
exists.
 
 Sputnik’s
Board of Directors determined the fairest measure of value of value of the stock
of Laika in this situation was the amount of debt owed by Sputnik to Mr. LaDuke
at December 15, 2007, which amounted to $65,000.
   12
   Item
14.  Principal Accounting Fees and Services
 
 The
aggregate fees billed by our principal accounting firm, for fees billed for
fiscal years ended December 31, 2008, and 2007 are as follows:
 
 Name
                              
                              Audit
      Fees(1)
                              
                              Audit
      Related Fees
                              
                              Tax
      Fees (2)
                              
                              All
      Other FeesM&K
      CPAS, PLLCfor
      fiscal year ended:December
      31, 2008
                              
                              $
                              17,553
                              
                              $
                              0
                              
                              $
                              0
                              
                              $
                              0December
      31, 2007
                              
                              $
                              32,200
                              
                              $
                              0
                              
                              $
                              0
                              
                              $
                              0
 ___________________________
 
 (1)
              Includes
      audit fees for the annual financial statements of the Company, and review
      of financial statements included in the Company's Form 10-Q quarterly
      reports and Form 10-K annual reports, and fees normally provided in
      connection with statutory and regulatory filings for those fiscal
      years
 
 The
Company does not currently have an audit committee. As a result, our board of
directors performs the duties and functions of an audit committee. The Company's
Board of Directors will evaluate and approve in advance, the scope and cost of
the engagement of an auditor before the auditor renders audit and non-audit
services. We do not rely on pre-approval policies and procedures.
  
 Part
IV
 
 Item
15. Exhibits, Financial Statement Schedules
 
 Copies of
the following documents are included as exhibits to this report pursuant to Item
601 of Regulation S-B.
 
 Exhibit
                        
                        Description31
                        
                        Certification
      of Principal Executive Officer and Principal Financial Officer pursuant to
      Section 302 of Sarbanes-Oxley Act of 200232
                        
                        Certification
      of Principal Executive Officer and Principal Financial Officer pursuant to
      Section 906 of Sarbanes-Oxley Act of
2002
 
 
 13
 
 
 SPUTNIK
ENTERPRISES INC.
 (A
Development Stage Company)
  INDEX
TO FINANCIAL STATEMENTS
  PageReport
      of Independent Registered Public Accounting Firm
                    F-2Financial
      Statements:Balance
      Sheets
                    F-3Statements
      of Expenses
                    F-4Statements
      of Cash Flows
                    F-5Statement
      of Changes in Stockholders' Deficit
                    F-6Notes
      to Financial Statements
                    F-7
                      F-8
   14
   REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
 
 To
the Board of Directors
 Sputnik
Enterprises Inc.
 (formerly
Sputnik, Inc.)
 
  We have
audited the accompanying balance sheets of Sputnik Enterprises Inc. (a
development stage company) as of December 31, 2008 and 2007, and the related
statements of expenses, changes in stockholders' equity (deficit), and cash
flows for the years then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
  We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
  In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Sputnik Enterprises Inc. and as of
December 31, 2008 and 2007, and the results of its operations, changes in
stockholders' equity (deficit) and cash flows for the period described
above in conformity with accounting principles generally accepted in the United
States of America.
  The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has suffered recurring losses from operations, which
raises substantial doubt about its ability to continue as a going concern.
Management's plans regarding those matters also are described in Note 2. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
  /s/
M&K CPAS, PLLC
  www.mkacpas.com
 Houston,
Texas
 March 31,
2009
 
  15
 
 SPUTNIK
ENTERPRISES, INC.
 (FORMERLY
SPUTNIK, INC.)
 (A
Development Stage Company)
 Balance
Sheets
 As
of December 31, 2008 and 2007
 
 
 December
      31,
                                                  2008
                                                
                                                
                                                December
      31,
                                                  2007ASSETSCurrent
      AssetsCash
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                -Total
      Current Assets
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -Net
      assets related to discontinued operations
                                                
                                                
                                                -
                                                
                                                
                                                
                                                97,050TOTAL
      ASSETS
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                97,050LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      LiabilitiesAccrued
      liabilities
                                                
                                                $
                                                1,940
                                                
                                                
                                                $
                                                -Note
      payable
                                                
                                                
                                                25,000
                                                
                                                
                                                
                                                -Total
      Current Liabilities
                                                
                                                
                                                26,940
                                                
                                                
                                                
                                                -Net
      liabilities related to discontinued operations
                                                
                                                
                                                -
                                                
                                                
                                                
                                                206,628Total  Liabilities
                                                
                                                
                                                26,940
                                                
                                                
                                                
                                                203,628Common
      stock, $.001 par value, 50,000,000 shares authorized,295,278shares issued and
      outstanding in both periods
                                                
                                                
                                                295
                                                
                                                
                                                
                                                295Paid-in
      capital
                                                
                                                
                                                1,932,090
                                                
                                                
                                                
                                                1,710,659Accumulated
      deficit from development stage
                                                
                                                
                                                (46,462
                                                )
                                                
                                                
                                                -Accumulated
      deficit from prior operations
                                                
                                                
                                                (1,912,863
                                                )
                                                
                                                
                                                (1,817,532
                                                )Total
      Stockholders' Deficit
                                                
                                                
                                                (26,940
                                                )
                                                
                                                
                                                (106,578
                                                )TOTAL
      LIABILITIES AND STOCKHOLDERS' DEFICIT
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                97,050
 
 The
accompanying notes are an integral part of these financial
statements.
   16
  
 SPUTNIK
ENTERPRISES, INC.
 (FORMERLY
SPUTNIK, INC.)
 (A
Development Stage Company)
 Consolidated
Statements of Operations
 Years
Ended December 31, 2008 and 2007
  
 Re-entering
                                                                                                      Development Stage to2008
                                                                                                    
                                                                                                    
                                                                                                    2007
                                                                                                    
                                                                                                    
                                                                                                    December
      31, 2008Revenue
                                                                                                    
                                                                                                    $
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    $
                                                                                                    -Cost
      of goods sold
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -Gross
      profit
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -ExpensesGeneral
      and administrative costs
                                                                                                    
                                                                                                    
                                                                                                    46,462
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    46,462Depreciation
      and amortization
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -Total
      operating expense
                                                                                                    
                                                                                                    
                                                                                                    46,462
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    46,462Operating
      Loss
                                                                                                    
                                                                                                    
                                                                                                    (46,462
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    (46,462
                                                                                                    )Interest
      income
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -Interest
      expense
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -NET
      LOSS FROM CONTINUING OPERATIONS
                                                                                                    
                                                                                                    $
                                                                                                    (46,462
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    $
                                                                                                    (46,462
                                                                                                    )Discontinued
      operationsLoss
      from discontinued operations
                                                                                                    
                                                                                                    
                                                                                                    (91,467
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    (717,296
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    -Loss
      on disposal
                                                                                                    
                                                                                                    
                                                                                                    (3,864
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    -
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    -NET
      LOSS
                                                                                                    
                                                                                                    $
                                                                                                    (141,793
                                                                                                    )
                                                                                                    
                                                                                                    $
                                                                                                    (717,296
                                                                                                    )
                                                                                                    
                                                                                                    $
                                                                                                    (46,462
                                                                                                    )Loss
      per common share from continuing operations – basic and
      diluted
                                                                                                    
                                                                                                    
                                                                                                    (0.00
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    (0.00
                                                                                                    )Loss
      per common share from discontinued operations – basic and
      diluted
                                                                                                    
                                                                                                    
                                                                                                    (0.00
                                                                                                    )
                                                                                                    
                                                                                                    
                                                                                                    (0.05
                                                                                                    )Basic
      and diluted loss per share
                                                                                                    
                                                                                                    $
                                                                                                    (0.00
                                                                                                    )
                                                                                                    
                                                                                                    $
                                                                                                    (0.05
                                                                                                    )Weighted
      average shares outstanding
                                                                                                    
                                                                                                    
                                                                                                    295,278
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    293,989
 
 The
accompanying notes are an integral part of these financial
statements.
   17
 
 SPUTNIK
ENTERPRISES, INC.
 (FORMERLY
SPUTNIK, INC.)
 (A
Development Stage Company)
 Statement
of Cash Flows
 For the
Year Ended December 31, 2008 and the Periods From July 27, 2007
(Inception)
 Through
November 30, 2007 and 2008
  2008
                                                                                
                                                                                
                                                                                2007
                                                                                
                                                                                
                                                                                Re-entering
                                                                                  Development
      Stage to
                                                                                  December
      31,
                                                                                  2008Cash
      Flows from Operating ActivitiesNet
      loss from operations
                                                                                
                                                                                $
                                                                                (46,462
                                                                                )
                                                                                
                                                                                $
                                                                                -
                                                                                
                                                                                
                                                                                $
                                                                                (46,462
                                                                                )Net
      loss from discontinued operations
                                                                                
                                                                                
                                                                                (91,
      467
                                                                                )
                                                                                
                                                                                
                                                                                (717,296
                                                                                )
                                                                                
                                                                                
                                                                                -Loss
      on disposal
                                                                                
                                                                                
                                                                                (3,864
                                                                                )
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                -Adjustments
      to reconcile net loss to netCash
      used in operating activities:Depreciation
                                                                                
                                                                                
                                                                                1,578
                                                                                
                                                                                
                                                                                
                                                                                9,372
                                                                                
                                                                                
                                                                                
                                                                                -Imputed
      interest on note payable
                                                                                
                                                                                
                                                                                2,908
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                999Note
      payable issued for legal expenses
                                                                                
                                                                                
                                                                                25,000
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                25,000Changes
      in working capital:Accounts
      receivable
                                                                                
                                                                                
                                                                                (5,660
                                                                                )
                                                                                
                                                                                
                                                                                (25,203
                                                                                )
                                                                                
                                                                                
                                                                                -Inventory
                                                                                
                                                                                
                                                                                (1,776
                                                                                )
                                                                                
                                                                                
                                                                                268
                                                                                
                                                                                
                                                                                
                                                                                -Prepaid
      expenses and other current assets
                                                                                
                                                                                
                                                                                (2.467
                                                                                )
                                                                                
                                                                                
                                                                                (29,414
                                                                                )
                                                                                
                                                                                
                                                                                -Deposit
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                2,466
                                                                                
                                                                                
                                                                                
                                                                                -Accounts
      payable and accrued liabilities
                                                                                
                                                                                
                                                                                16,928
                                                                                
                                                                                
                                                                                
                                                                                52,800
                                                                                
                                                                                
                                                                                
                                                                                1,940Net
      cash used in operating activities
                                                                                
                                                                                
                                                                                (105,282
                                                                                )
                                                                                
                                                                                
                                                                                (707,007
                                                                                )
                                                                                
                                                                                
                                                                                (18,523
                                                                                )Cash
      Flows from Investing ActivitiesCash
      distributed in spin off
                                                                                
                                                                                
                                                                                (23,580
                                                                                )
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                -Purchase
      of property and equipment
                                                                                
                                                                                
                                                                                -
                                                                                
                                                                                
                                                                                
                                                                                (4,489
                                                                                )
                                                                                
                                                                                
                                                                                -Net
      cash used in investing activities
                                                                                
                                                                                
                                                                                (23,580
                                                                                )
                                                                                
                                                                                
                                                                                (4,489
                                                                                )
                                                                                
                                                                                
                                                                                -Cash
      Flows from Financing ActivitiesLine
      of credit and other liabilities
                                                                                
                                                                                
                                                                                (20,369
                                                                                )
                                                                                
                                                                                
                                                                                24,418
                                                                                
                                                                                
                                                                                
                                                                                -Donated
      capital from shareholder
                                                                                
                                                                                
                                                                                18,523
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                18,523Proceeds
      from advance from shareholder
                                                                                
                                                                                
                                                                                135,000
                                                                                
                                                                                
                                                                                
                                                                                65,000
                                                                                
                                                                                
                                                                                
                                                                                -Common
      stock issued for cash
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                
                                                                                622,443
                                                                                
                                                                                
                                                                                
                                                                                -Net
      cash provided by financing activities
                                                                                
                                                                                
                                                                                133,154
                                                                                
                                                                                
                                                                                
                                                                                707,861
                                                                                
                                                                                
                                                                                
                                                                                18,523Net
      change in cash
                                                                                
                                                                                
                                                                                (4,292
                                                                                )
                                                                                
                                                                                
                                                                                (3,635
                                                                                )
                                                                                
                                                                                
                                                                                -Cash
      at beginning of year
                                                                                
                                                                                
                                                                                4,292
                                                                                
                                                                                
                                                                                
                                                                                7,927
                                                                                
                                                                                
                                                                                
                                                                                -Cash
      at end of year
                                                                                
                                                                                $
                                                                                -
                                                                                
                                                                                
                                                                                $
                                                                                4,292
                                                                                
                                                                                
                                                                                
                                                                                -Supplemental
      Disclosures of Cash Flow InformationCash
      paid for interest
                                                                                
                                                                                $
                                                                                853
                                                                                
                                                                                
                                                                                $
                                                                                1,197
                                                                                
                                                                                
                                                                                $
                                                                                -Cash
      paid for income taxes
                                                                                
                                                                                
                                                                                -
                                                                                
                                                                                
                                                                                
                                                                                -
                                                                                
                                                                                
                                                                                
                                                                                -
    18
  SPUTNIK
ENTERPRISES, INC.
 (FORMERLY
SPUTNIK, INC.)
 (A
Development Stage Company)
 Statement
of Changes in Stockholder's Equity (Deficit)
 Years
Ended December 31, 2008 and 2007
 
 AccumulatedAdditional
                                    
                                    
                                    (Deficit)
                                    
                                    
                                    TotalCommon
      Stock
                                    
                                    
                                    Paid-in
                                    
                                    
                                    Development
                                    
                                    
                                    Prior
                                    
                                    
                                    Stockholders'Number
      of Shares
                                    
                                    
                                    Amount
                                    
                                    
                                    Capital
                                    
                                    
                                    Stage
                                    
                                    
                                    Operations
                                    
                                    
                                    DeficitBalances,
      December 31, 2006
                                    
                                    
                                    276,126
                                    
                                    
                                    $
                                    276
                                    
                                    
                                    $
                                    1,088,235
                                    
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    (1,100,236
                                    )
                                    
                                    $
                                    (11,725
                                    )Share
      issuances for cash
                                    
                                    
                                    19,152
                                    
                                    
                                    
                                    19
                                    
                                    
                                    
                                    622,424
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    622,443Net
      loss
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (717,296
                                    )
                                    
                                    
                                    (717,296
                                    )Balance
      – December 31, 2007
                                    
                                    
                                    295,278
                                    
                                    
                                    
                                    295
                                    
                                    
                                    
                                    1,710,659
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (1,817,532
                                    )
                                    
                                    
                                    (106,578
                                    )Imputed
      interest
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    2,908
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    2,908Donated
      capital from shareholder
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    18,523
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    18,523Laika
      adjustment
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    200,000
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    200,000Net
      loss
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (46,462
                                    )
                                    
                                    
                                    (95,331
                                    )
                                    
                                    
                                    (141,793
                                    )Balance
      - December 31, 2008
                                    
                                    
                                    295,278
                                    
                                    
                                    $
                                    295
                                    
                                    
                                    $
                                    1,932,090
                                    
                                    
                                    $
                                    (46,462
                                    )
                                    
                                    $
                                    (1,912,863
                                    )
                                    
                                    $
                                    (26,940
                                    )
 The
accompanying notes are an integral part of these financial
statements.
 
  19
   SPUTNIK
ENTERPRISES, INC.
 (FORMERLY
SPUTNIK, INC.)
 (A
Development Stage Company)
 NOTES
TO FINANCIAL STATEMENTS
 
 NOTE
1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 History
 
 Sputnik
Enterprises Inc. was incorporated in the State of Delaware on September 27, 2001
under the name Sputnik, Inc. On February 10, 2005, we filed Articles of
Conversion and new articles of incorporation in Nevada and became a Nevada
corporation. From that time until February 29, 2008 the Company developed and
marketed Wi-Fi software, services, and hardware for the public access wireless
networking market.
 
 On
November 13, 2007 we formed a wholly owned subsidiary, Laika, Inc., and
transferred all of our assets and liabilities to Laika.
 
 On
February 6, 2008, the Company amended its Articles of Incorporation to change
the name of Sputnik, Inc. to Sputnik Enterprises, Inc. upon conclusion of the
sale of the stock of Laika, Inc. to AstroChimp, Inc., a Nevada corporation
wholly owned by David LaDuke, Sputnik’s President and Director.
 
 On
February 29, 2008, we closed the sale of the stock of our wholly owned
subsidiary, Laika, Inc. to AstroChimp, Inc. for cancellation of $65,000 of David
LaDuke to us, leaving us as a shell company.  AstroChimp is
wholly-owned by Mr. LaDuke. Subsequently Astrochimp, Inc. changed its name to
Sputnik, Inc. and continues to own and operate its business as a private
entity.
 
 Sputnik
Enterprises seeks the consummation of a reverse merger with another operating
company but has had and will have no active operations until such reverse merger
is finalized.
 
 Basis of
Presentation
 
 The
Company follows accounting principles generally accepted in the United States of
America.  In the opinion of management, all adjustments, consisting of
normal recurring adjustments, necessary for a fair presentation of financial
position and the results of operations for the periods presented have been
reflected herein.
 
 Use of
Estimates
 
 The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting periods.
Actual results could differ from those estimates and assumptions.
 
 Cash and Cash
Equivalents
 
 For
purposes of the statements of cash flows, Sputnik Enterprises considers all
highly liquid investments purchased with an original maturity of three months or
less to be cash equivalents. As of December 31, 2008 and 2007, there were no
cash equivalents.
 
 Development Stage
Company
 
 The
Company complies with Statement of Financial Accounting Standard ("SFAS") No. 7
and the Securities and Exchange Commission Exchange Act 7 for its
characterization of the Company as development stage.
 
 Revenue
Recognition
 
 Sputnik
Enterprises recognizes revenue when persuasive evidence of an arrangement
exists, services have been rendered, the sales price is fixed or determinable,
and collectability is reasonably assured.
   20
 
 Income
Taxes
 
 Sputnik
Enterprises uses the liability method of accounting for income taxes pursuant to
Statement of Financial Accounting Standards No. 109. Under this method, deferred
income taxes are recorded to reflect the tax consequences in future years of
temporary differences between the tax basis of the assets and liabilities and
their financial amounts at year end.
 
 Basic and Diluted Net Loss
per Share
 
 Basic
earnings per common share is computed based upon the weighted average number of
common shares outstanding during the period. Diluted earnings per share consists
of the weighted average number of common shares outstanding plus the dilutive
effects of options and warrants calculated using the treasury stock method. In
loss periods, dilutive common equivalent shares are excluded as the effect would
be anti-dilutive. At December 31, 2008, no equivalents existed because the
effect would be anti-dilutive.
 
 Stock Based
Compensation
 
 The
Company accounts for stock-based employee compensation arrangements using the
fair value method in accordance with the provisions of Statement of Financial
Accounting Standards no.123(R) or SFAS No. 123(R), Share-Based Payments, and
Staff Accounting Bulletin No. 107, or SAB 107, Share-Based Payments.  The
company accounts for the stock options issued to non-employees in accordance
with the provisions of Statement of Financial Accounting Standards No. 123, or
SFAS No. 123, Accounting for Stock-Based Compensation, and Emerging Issues Task
Force No. 96-18, Accounting for Equity Instruments with Variable Terms That Are
Issued for Consideration other Than Employee Services under FASB Statement no.
123.
 
 The
Company did not grant any stock options during the period ended December 31,
2008.
 
 Impairment of Long Lived
Assets
 
 Long-lived
assets are reviewed for impairment in accordance with SFAS No. 144, "Accounting
for the Impairment or Disposal of Long- lived Assets". Under SFAS No. 144,
long-lived assets are tested for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. An
impairment charge is recognized or the amount, if any, which the carrying value
of the asset exceeds the fair value.
 
 Recently Issued Accounting
Pronouncements
 
 Sputnik
Enterprises does not expect the adoption of recently issued accounting
pronouncements to have a material effect on its results of operations, financial
position, or cash flows.
 
 NOTE
2 - GOING CONCERN
 
 The
accompanying financial statements have been prepared assuming that Sputnik
Enterprises will continue as a going concern. As shown in the accompanying
financial statements, Sputnik suffered losses of $141,793 for the year ended
December 31, 2008 and has an accumulated deficit of 1,959,325 at December 31,
2008. These conditions raise substantial doubt as to Sputnik's ability to
continue as a going concern. The financial statements do not include any
adjustments that might be necessary if Sputnik is unable to continue as a going
concern.
 
 NOTE
3 - RELATED PARTY TRANSACTIONS
 
 Sputnik
Enterprises neither owns nor leases any real or personal property. Most office
services are provided without charge by the President. Such costs are immaterial
to the financial statements and accordingly, have not been reflected therein.
The officers / directors are involved in other business activities and may, in
the future, become involved in other business opportunities that become
available, such persons may face a conflict in selecting between Sputnik
Enterprises and their other business interests. Sputnik Enterprises has not
formulated a policy for the resolution of such conflicts.
   21
 
 NOTE
4 - INCOME TAXES
 
 Sputnik
uses the liability method, where deferred tax assets and liabilities are
determined based on the expected future tax consequences of temporary
differences between the carrying amounts of assets and liabilities for financial
and income tax reporting purposes. During fiscal 2008 and 2007, Sputnik incurred
a net loss and therefore has no tax liability. The net deferred tax asset
generated by the loss carry-forward has been fully reserved. The cumulative net
operating loss carry-forward is $1,544,768 and $1,402,975 at December 31, 2008
and 2007, respectively, and will begin to expire in the year 2023.
 
 At
November 30, 2008 and 2007, deferred tax assets consisted of the
following:
  Deferred
      tax assets
                  
                  2008
                  
                  
                  2007Net
      operating losses
                  
                  $
                  525,221
                  
                  
                  $
                  477,012Less:  valuation
      allowance
                  
                  
                  (525,221
                  )
                  
                  
                  (477,012
                  )Net
      deferred tax asset
                  
                  $
                  -
                  
                  
                  $
                  -
  NOTE
5 – NOTE PAYABLE
 
 On July
1, 2008, the Company issued a note in the amount of $25,000 to legal counsel for
legal expenses to be incurred during the quarter. The note is due on demand and
has no stated interest rate. Imputed interest in the amount of $2,908 calculated
at 8% interest is reflected as an increase to additional paid in
capital.
 
 NOTE
6 – DISCONTINUED OPERATIONS
 
 On
February 6, 2008, Sputnik amended our Articles of Incorporation to change the
name of Sputnik, Inc. to Sputnik Enterprises, Inc. upon conclusion of the sale
of the stock of Laika, Inc. to AstroChimp, Inc., and to give the authority to
issue an additional 10,000,000 shares which will be designated “Preferred
Stock”
 
 This
resolution was undertaken because management determined that additional capital
could be raised by transforming itself into a public shell, having management
sell a controlling interest in the public shell, and management agreeing to
invest all proceeds of the sale of such controlling interest into Laika, after
payment of all personal tax liabilities and out-of-pocket expenses as a result
of such sale, and management has agreed to do so.
 
 On
February 29, 2008, we closed the sale of the stock of our wholly owned
subsidiary, Laika, Inc. to AstroChimp, Inc., leaving us as a shell
company.
 
 In
connection with the sale of stock, all of the assets and liabilities were
transferred and the due to affiliate was forgiven and treated as additional paid
in capital. The following schedule shows the effects of the dividend
distribution which resulted from the sale of the stock of the wholly owned
subsidiary at February 29, 2008:
  February
      29,
                        2008
                      
                      
                      Adjustments
                      
                      
                      Adjusted
                        February
      29, 2008ASSETSCurrent
      AssetsCash
                      
                      $
                      27,444
                      
                      
                      $
                      (27,444
                      )
                      
                      $
                      -Accounts
      receivable
                      
                      
                      35,462
                      
                      
                      
                      (35,462
                      )
                      
                      
                      -Inventory
                      
                      
                      11,561
                      
                      
                      
                      (11,561
                      )
                      
                      
                      -Prepaid
      expenses and other assets
                      
                      
                      39,782
                      
                      
                      
                      (39,782
                      )
                      
                      
                      -Total
      Current Assets
                      
                      
                      114,249
                      
                      
                      
                      (114,249
                      )
                      
                      
                      -Property
      and equipment, net
                      
                      
                      8,177
                      
                      
                      
                      (8,177
                      )
                      
                      
                      -Deposit
                      
                      
                      6,101
                      
                      
                      
                      (6,101
                      )
                      
                      
                      -TOTAL
      ASSETS
                      
                      $
                      128,527
                      
                      
                      $
                      (128,527
                      )
                      
                      $
                      -
 22
 
 
 February
      29,
                                              2008
                                            
                                            
                                            Adjustments
                                            
                                            
                                            Adjusted
                                              February
      29, 2008LIABILITIES
      AND STOCKHOLDERS' EQUITYCurrent
      LiabilitiesAccounts
      payable
                                            
                                            $
                                            61,494
                                            
                                            
                                            $
                                            (61,494
                                            )
                                            
                                            $
                                            -Due
      to affiliate
                                            
                                            
                                            200,000
                                            
                                            
                                            
                                            (200,000
                                            )
                                            
                                            
                                            -Deferred
      revenue
                                            
                                            
                                            13,008
                                            
                                            
                                            
                                            (13,008
                                            )
                                            
                                            
                                            -Accrued
      liabilities
                                            
                                            
                                            50,161
                                            
                                            
                                            
                                            (50,161
                                            )
                                            
                                            
                                            -Total
      Current Liabilities
                                            
                                            
                                            324,663
                                            
                                            
                                            
                                            (324,663
                                            )
                                            
                                            
                                            -Stockholders'
      EquityPreferred
      stock, $.001 par value, 10,000,000 shares authorized, none issued and
      outstanding
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -Common
      stock, $.001 par value, 50,000,000 shares authorized 14,763,919shares issued and
      outstanding
                                            
                                            
                                            14,764
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            14,764Paid-in
      capital
                                            
                                            
                                            1,698,099
                                            
                                            
                                            
                                            200,000
                                            
                                            
                                            
                                            1,898,099Accumulated
      deficit
                                            
                                            
                                            (1,908,999
                                            )
                                            
                                            
                                            (3,864
                                            )
                                            
                                            
                                            (1,912,863
                                            )Total
      Stockholders' Equity
                                            
                                            
                                            (196,136
                                            )
                                            
                                            
                                            196,136
                                            
                                            
                                            
                                            -TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
                                            
                                            $
                                            128,527
                                            
                                            
                                            $
                                            (128,527
                                            )
                                            
                                            $
                                            -
   
 Net
      Assets Related to Discontinued OperationsCash
      related to discontinued operations
                  
                  $
                  4,292Accounts
      receivable related to discontinued operations, net of allowance of
      $0
                  
                  
                  29,802Inventory
      related to discontinued operations
                  
                  
                  9,785Prepaid
      expenses and other assets related to discontinued
    operations
                  
                  
                  37,315Property
      and equipment related to discontinued operations , net of accumulated
      depreciation of  $0 and $18,758, respectively
                  
                  
                  9,755Deposit
      related to discontinued operations
                  
                  
                  6,101Total
      Net Assets Related to Discontinued Operations
                  
                  $
                  97,050Net
      Liabilities Related to Discontinued OperationsAccounts
      payable related to discontinued operations
                  
                  $
                  55,041Accrued
      liabilities related to discontinued operations
                  
                  
                  50,161Deferred
      revenue related to discontinued operations
                  
                  
                  13,008Line
      of credit related to discontinued operations
                  
                  
                  20,418Note
      payable related to discontinued operations
                  
                  
                  -Due
      to shareholder related to discontinued operations
                  
                  
                  65,000Total
      Net Liabilities Related to Discontinued Operations
                  
                  $
                  203,628
 
 
 NOTE
7 – CAPITAL STOCK
 
 On
October 27, 2008, Sputnik Enterprises, Inc. executed a 50:1 reverse split of its
stock, with fractional shares rounded up. All share information presented has
been adjusted to reflect the reverse split.
   23
  
 SIGNATURES
 
 In
accordance with the requirements of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, hereunto duly
authorized.


SPUTNIK
      ENTERPRISES INC.Dated:
      March 31, 2009
                By:
                /s/ David
      LaDukeDavid
      LaDuke, Chief Executive Officer and President




Dated:
      March 31, 2009
                    By:
                    /s/ David
      LaDukeDavid
      LaDuke, Director




24